X

Sign up for Equitymaster's free daily newsletter, The 5 Minute WrapUp and get access to our latest Multibagger guide (2017 Edition) on picking money-making stocks.

This is an entirely free service. No payments are to be made.


Download Now Subscribe to our free daily e-letter, The 5 Minute WrapUp and get this complimentary report.
We hate spam as much as you do. Check out our Privacy Policy and Terms Of Use.
Whom will you trust now? - Views on News from Equitymaster
 
 
  • PRINT
  • E-MAIL
  • FEEDBACK
  • A  A  A
  • Dec 18, 2008

    Whom will you trust now?

    "I'm not upset that you lied to me, I'm upset that from now on I can't believe you." - Friedrich Nietzsche, German classical scholar and philosopher

    Satyam’s announcement of transferring funds to promoter group companies by buying stakes in the latter raises a stink. It leads to you doubt the faith that you put on a company’s management, its independent directors, auditors, consultants and rating agencies. Simply put, it shakes your entire chain of belief that you had on these parties.

    In Satyam’s case, you have a chain which had all its links weak. The management had no sense of defense for the announcement it made. Independent directors passing such a resolution, is equally horrifying. And where were the auditors when the deal was being finalised? What about the consultants who advised on the same? What faith does one has on rating agencies that rated Satyam high on corporate governance? Shockingly, Satyam was recently awarded the Golden Peacock award for corporate governance for 2008!

    "You are putting the whole FDI story of India at risk by adopting such third grade corporate governance practices," said one of the participants in Satyam’s analyst call to discuss the transaction. We second this gentleman’s thought!

    Another one said - "We do not want this decision to be taken and we are willing to go to any length to prevent this thing from happening. Apart from the odd ownership which you have and the management opposition you enjoy in the company, there are also minority shareholders which are existing and we think that it will be in the best interest that Satyam withdraws this proposal."

    This one is our favourite - "The company's goal is to find creative and productive ways to delight its stakeholders," says the first paragraph on corporate governance in Satyam’s FY08 annual report. We now know what creativity can be all about! And do they teach such ‘creativity’ in US biz schools? Wondering because Mr. Ramalinga Raju gave enough stress that the two companies - Maytas Infra and Maytas Properties - are indeed being managed by his sons, both of whom have done their MBAs from the US!

    Anyways, Business Line reports that Satyam is now planning a share buyback to appease investors. Let them buy. You must know what to do!

     

     

    Equitymaster requests your view! Post a comment on "Whom will you trust now?". Click here!

      
     

    More Views on News

    Tech Mahindra: Our Revised View (Quarterly Results Update - Detailed)

    Aug 2, 2017

    A better than expected turnaround in performance results in a change in view.

    Wipro: A Decent Start to the Year (Quarterly Results Update - Detailed)

    Jul 27, 2017

    Digital services drive growth for Wipro in 1QFY18.

    Infosys: A Decent Start to FY18 (Quarterly Results Update - Detailed)

    Jul 14, 2017

    Infosys starts FY18 on an encouraging note with a stable performance.

    Ankit Shah's First Five Insider Recommendations (The 5 Minute Wrapup)

    Aug 5, 2017

    How to get exclusive insider recommendations from Ankit Shah.

    TCS: Currency Volatility Plays Spoilsport (Quarterly Results Update - Detailed)

    Jul 14, 2017

    TCS starts FY18 decently despite an adverse currency impact.

    More Views on News

    Most Popular

    A 'Backdoor' to Multibaggers: It's Like Investing in Asian Paints Ten Years Ago(The 5 Minute Wrapup)

    Aug 10, 2017

    Don't miss these proxy bets on growing companies or in a few years you will be looking back with regret.

    The Most Important Innovation in Finance Since Gold Coins(Vivek Kaul's Diary)

    Aug 10, 2017

    Bill connects the dots...between money and growth, real money and real resources, gold and cryptocurrencies...and between gold, cryptocurrencies, and time.

    Signs of Life in the India VIX(Daily Profit Hunter)

    Aug 12, 2017

    The India VIX is up 36% in the last week. Fear has gone up but is still low by historical standards.

    Bitcoin Continues Stellar Rise(Chart Of The Day)

    Aug 10, 2017

    Bitcoin hits an all-time high, is there more upside left?

    5 Steps To Become Financially Independent(Outside View)

    Aug 16, 2017

    Ensure your financial Independence, and pledge to start the journey towards financial freedom today!

    More
    Copyright © Equitymaster Agora Research Private Limited. All rights reserved.
    Any act of copying, reproducing or distributing this newsletter whether wholly or in part, for any purpose without the permission of Equitymaster is strictly prohibited and shall be deemed to be copyright infringement.

    LEGAL DISCLAIMER: Equitymaster Agora Research Private Limited (hereinafter referred as 'Equitymaster') is an independent equity research Company. Equitymaster is not an Investment Adviser. Information herein should be regarded as a resource only and should be used at one's own risk. This is not an offer to sell or solicitation to buy any securities and Equitymaster will not be liable for any losses incurred or investment(s) made or decisions taken/or not taken based on the information provided herein. Information contained herein does not constitute investment advice or a personal recommendation or take into account the particular investment objectives, financial situations, or needs of individual subscribers. Before acting on any recommendation, subscribers should consider whether it is suitable for their particular circumstances and, if necessary, seek an independent professional advice. This is not directed for access or use by anyone in a country, especially, USA or Canada, where such use or access is unlawful or which may subject Equitymaster or its affiliates to any registration or licensing requirement. All content and information is provided on an 'As Is' basis by Equitymaster. Information herein is believed to be reliable but Equitymaster does not warrant its completeness or accuracy and expressly disclaims all warranties and conditions of any kind, whether express or implied. Equitymaster may hold shares in the company/ies discussed herein. As a condition to accessing Equitymaster content and website, you agree to our Terms and Conditions of Use, available here. The performance data quoted represents past performance and does not guarantee future results.

    SEBI (Research Analysts) Regulations 2014, Registration No. INH000000537.

    Equitymaster Agora Research Private Limited. 103, Regent Chambers, Above Status Restaurant, Nariman Point, Mumbai - 400 021. India.
    Telephone: +91-22-61434055. Fax: +91-22-22028550. Email: info@equitymaster.com. Website: www.equitymaster.com. CIN:U74999MH2007PTC175407
     

    Become A Smarter Investor In
    Just 5 Minutes

    Multibagger Stocks Guide 2017
    Get our special report, Multibagger Stocks Guide (2017 Edition) Now!
    We will never sell or rent your email id.
    Please read our Terms

    S&P BSE IT


    Aug 22, 2017 (Close)

    S&P BSE IT 5-YR ANALYSIS

    COMPARE COMPANY

    MARKET STATS